How to Become a Hosting Reseller

By The Hosting News Staff

Starting a new company can be quite expensive. Just leasing a dedicated server can cost well over $200/month. Added with the administrative costs for software setup, maintenance, upgrades, and unforeseeable emergencies, the cost can quickly climb well above just the $200/month for the server. Reseller hosting provides a simple option for those who don’t wish to incur the monthly cost of a dedicated server and want to start smaller.

What is Reseller Hosting?
Reseller hosting is a type of hosting where an existing company sells you a portion of space and an amount of bandwidth on a server in exchange for a monthly fee. This monthly fee is usually greater than that of standard hosting, but compensates for the increased amount of space, bandwidth, and the additional software licenses that sometimes have to be purchased for use on a reseller hosting account.

The alloted resources are then available to be distributed to other sites or customers for standard web hosting. Each individual website hosted off the reseller packaging usually receives their own control panel (such as cPanel or Plesk) for their use. Customers perceive absolutely no difference between a company using a reseller web hosting account and a host which leases their own server(s).

The Advantages of Reseller Hosting
The advantages of reseller hosting are numerous. While the bandwidth and space may be more expensive per unit than that purchased with a dedicated server, reseller accounts allow the space and bandwidth to be purchased in smaller ‘chunks’. That way smaller hosts aren’t wasting resources – and subsequently money. This allows new hosts to grow into a dedicated server instead of taking the large initial plunge with the much higher monthly fee. A start up host may now yield a small profit instead of a large loss month after month.

Besides this, many know the old sang ‘’stuff happens”. A hard drive might go bad on a server, an operating system might be corrupt, a cable might break…the list goes on and on. There are just simply things that could go wrong. With reseller hosting, the majority of the time someone else is responsible for the problem. While it may be little piece of mind if your customers experience some downtime, it is someone else’s server, and it won’t be your responsibility to install security updates to key software or replace hardware that has failed.

The Downside of Reseller Hosting
Reseller hosting offers fewer resources than a dedicated server, and thus may exceed resource constraints sooner than with a dedicated server. A reseller hosting account can only hold so many clients before the space and bandwidth are greater than any reseller package the hosting company can provide, and it becomes more economically feasible to upgrade to a dedicated server. This requires moving clients from the reseller account to the dedicated server, which could result in downtime. In addition to the moving and expansion issues, most reseller hosting accounts offer little in terms of customization. Reseller accounts are usually set in what software is installed on the box, and the versions available. An example would be a client asking for PHP 5, when the version that’s installed on the server hosting the reseller account is PHP 4. While some hosts may be happy to upgrade and accommodate, other hosts will not be able to upgrade as quickly.

What to Look for in a Reseller
Reseller accounts should be selected in much the same manner as standard hosting accounts. The first reason to not choose a host is if they offer “unlimited” space or bandwidth. There’s no such thing as either of these, and most hosts that offer this are selling beyond the resources they have.

Look carefully at the services and resources the reseller hosting account offers. Some will only allow a certain number of SQL databases, email accounts, domains hosted, and even a certain number of customers that are allowed to be hosted. Pay close attention to ensure that you receive the amount of resource you will need for your reseller business. There are several good resources to check when considering potential reseller hosting companies. Two good industry resources are WHT, also known as Web Hosting Talk – a discussion forum related to the web hosting industry, and The Hosting News – an online news and information source on dedicated servers and reseller web hosting.

A Successful Reseller Host
Buying a managed reseller hosting account will probably not make you instantly rich, instantly generate an income, or instantly known in the web hosting world. It takes a commitment to customer service, by delivering the best service possible. Research needs to be conducted on how to setup plans and pricing, how to ensure support requests are handled quickly, and how to get your company name out there. While a reseller account can get a company started, it takes simple, common business sense to keep it going. Good luck with your new venture.